With growing convenience and digitization, many investors prefer trading through dematerialized (Demat) accounts. While most people consider brokerage fees while trading, an often-overlooked cost is the Depository Participant (DP) charge. Understanding DP charges is essential to managing your investments more efficiently and planning your trading expenses better.

What are the DP charges?

DP charges are transaction fees levied by depositories and their participants when investors sell shares from their Demat account. These charges are distinct from brokerage fees and are collected by the depositories—NSDL or CDSL—through your broker. While brokerage is often highlighted, DP charges form an important component of your overall trading cost.

Charges Apply To DP.

DP charges are applicable whenever you sell shares held in your Demat account. These are applied on a per ISIN (International Securities Identification Number) basis, regardless of the number of shares sold. For instance, whether you sell 10 or 1,000 shares of a single stock, the DP charge remains the same.

Breakup of DP Charges in 2025

The new DP charges structure in India for the year 2025 is as follows:

• NSDL/CDSL Charges: ₹4.50 per ISIN per transaction
• Depository Participant (Broker) Charges: Between ₹8 and ₹20 per ISIN per transaction
• GST: 18% applicable on DP charges

For example, if your broker charges ₹15 per ISIN and you sell shares of two different companies on a single day, then your DP charges would be: (₹4.50 + ₹15) x 2 + GST = ₹45.90 These deductions would automatically be made by your trading account when the sale of the shares takes place.

Are DP Charges Applicable When Buying Shares?

No. DP charges are applicable only on the sale of shares. When you buy shares, they are credited to your Demat account without any DP charge. However, other charges such as brokerage and statutory taxes may apply on the purchase.

How to Reduce or Avoid DP Charges?

1. Opt for a Free Demat Account

In 2025, numerous brokers are offering free demat accounts with zero or low DP charges. Some DP charges cannot be avoided because part of it has to go under the depositories, but most brokers subsidize or reduce the DP charges. So, look for brokers offering discounted DP charges as a promotional offer.

2. Go for a Broker with Low DP Charges

DP charges vary across brokers. Discount brokers often charge lower DP fees than full-service brokers. Compare DP charges across platforms before choosing a broker to optimize your trading costs.

3. Consolidate Your Trades

Since DP charges are levied per ISIN per transaction, it is cost-effective to sell shares in a consolidated manner instead of in smaller multiple transactions. For example, selling 100 shares in one order may be more economical than splitting it into two trades of 50 shares each.

4. Use ETFs and Mutual Funds

While there are DP charges on share selling, these are not applicable on mutual funds. Hence, if you are a frequent trader in individual stocks, you might want to examine ETFs or mutual funds that will not attract DP charges upon redemption or selling.

5. Seek Brokers with DP Charge Reimbursement

Some brokers offer DP charge reimbursements or cashback periodically. If you’re an active trader, it’s worth checking for such offers to lower your overall trading expenses.

List of Brokers with Free Demat Accounts & Lower DP Charges (2025)

A good number of brokers in India offer free Demat accounts with charging DP rates. To name a few:

Zerodha – DP charges: ₹13.5 per ISIN

Groww- DP charges: ₹8 per ISIN

Upstox- DP charges: ₹10 per ISIN

Angel One- DP charges: ₹15 per ISIN

5Paisa- DP charges: ₹12 per ISIN

These brokers offer free Demat accounts (zero account opening fees and often no annual maintenance charges), making them accessible options for cost-conscious investors. However, it’s important to review all terms and charges before selecting a broker.

Conclusion

While DP charges don’t really seem to be much of trading costs, eventually these may start to add up and affect whatever little you may be expecting as your return on investment. Knowing when and how DP charges are applied along with choosing the right brokers would help manage them. Awareness and planning provide a long way towards optimising the experience of trading.